Labuan, a small island located southwest of Sabah, was officially declared a Federal Territory today. The move, which saw the island ceded from the Sabah government to the Malaysian federal government, marks a significant shift in the region’s governance and strategic importance.
The official declaration was signed by Sabah Chief Minister Datuk Harris Salleh and Malaysian Prime Minister Datuk Seri Dr. Mahathir Mohamad, formalizing Labuan’s status as an 88-square-kilometer Federal Territory. With this transfer of authority, the Malaysian federal government now assumes full responsibility for the island’s administration.
Datuk Harris Salleh, in his speech during the declaration, stated that the decision to hand over Labuan was partly aimed at preventing secessionist movements in Sabah. He noted that past attempts to break away from the Malaysian Federation justified the need for a strong federal presence in the region.
“There have been attempts in this part of Malaysia to secede from the federation, and there is no iron-clad guarantee that such plots will not arise again. To ensure that no secession attempt is made, whether in Sabah or elsewhere, an immovable federal presence in this part of the nation is necessary,” said Datuk Harris.
Government officials also cited economic reasons for the decision, stating that Sabah lacked the capacity to develop Labuan into a competitive hub. The burden of building infrastructure and industries on the island, which faced stiff foreign competition, was considered too heavy for Sabah’s administration.
Prime Minister Dr. Mahathir Mohamad assured that the federal government would work to transform Labuan into a vital tourism and trade center for Southeast Asia. He acknowledged that the ceding of Labuan was a major sacrifice for the Sabah government, as it had to forego its direct interests for the sake of national development and unity.
Furthermore, Dr. Mahathir sought to reassure the 35,000 residents of Labuan that their special privileges would remain unaffected by the change.
The decision to make Labuan a Federal Territory remains a historical turning point, shaping the island’s role in Malaysia’s economic and political landscape. However, for many in Sabah, the transfer of Labuan continues to raise questions about autonomy, governance, and federal influence in the state’s affairs.
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